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2018 Pillar 3 Disclosures
Risk Management
Responsibilities of the governing
bodies
The Board of Directors of Cecabank establishes the bank’s business objectives and is the
maximum authority responsible for the risks that its takes when carrying out its activities.
It is therefore this body which establishes the risk appetite and general policies with regard
to the assumption of risks. Similarly, the Board is the driving force in the corporate risk
culture, which focuses on guaranteeing efficient internal control systems and rigorous and
complete risk management and measurement processes. During 2018, this body met on a
monthly basis.
The Board of Directors of Cecabank comprises the number of members designated in the General
Assembly of Shareholders, which cannot be less than 5 or more than 15. At its meeting held on 20
March 2018, the General Assembly of Shareholders set the number of directors at thirteen (13).
Based on the foregoing, at 31 December 2018 the Board comprised 13 directors, seven of which
are proprietary directors, 5 independent directors and one the executive director.
The delegated committees of the Board of Directors of Cecabank assist it in performing
its responsibilities. All details regarding the composition, functions and operation of these
committees can be found in the stakeholders section of the Cecabank corporate website.
Specifically, with regard to risks, these bodies undertake the following activities:
•
Audit Committee:
This Committee supervises and assesses the effectiveness of the internal
control structure of the bank, internal auditing and risk management systems; as well as
overseeing the process for preparing and submitting regulated financial information. The Audit
Committee held six meetings in 2018.
•
Risk Committee:
This Committee advises the Board as to the establishment and monitoring
of the risk appetite of the bank, and evaluates the application of this strategy by senior
management and the results thereof. The Risk Committee held five meetings in 2018.
•
Remuneration Committee:
This body advises the Board with regard to the bank’s
remuneration policies and the alignment thereof with the maintenance of risk tolerance levels.
The Remuneration Committee met on 2 occasions in 2018.
•
Appointments Committee:
This Committee advises the Board in relation to candidates for
vacant positions on the Board of Directors and compliance with the suitability requirements for
the Board’s members. The Appointments Committee held six meetings in 2018.
To assist the Cecabank Board of Directors to fulfil its risk responsibilities regarding the
maintenance of the risk profile and the implementation of the policies agreed, it has established
a reporting and monitoring system.
The main objective of this supervisory exercise is to keep the Board abreast, directly and through
its supporting bodies, of compliance with the tolerance limits of the evolution of the metrics
supporting them; to prospectively identify any source that could result in an infringement of the
limits and to raise the alarm in the case of any stress situations; and to enable corrective actions
to be taken, when appropriate.
To this end, the Risk Committee, with the support of the Risk Department, develops the outline
and contents of the reporting received from internal units and that which is sent to the Board.
2.2.1
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